April 30, 2018 / 1:18 PM / 24 days ago

Broadcom says weak wireless chip demand to hurt revenue forecast

(Reuters) - Chipmaker Broadcom, which counts Apple Inc among its customers, on Monday cut the top end of its previously issued second-quarter revenue forecast, citing weak demand for its wireless chips.

A sign to the campus offices of chip maker Broadcom Ltd, who announced on Monday an unsolicited bid to buy peer Qualcomm Inc for $103 billion, is shown in Irvine, California, U.S., November 6, 2017. REUTERS/Mike Blake/Files

The company said it now expects revenue of $4.975 billion to $5.025 billion. It had previously forecast net revenue of $5 billion, plus or minus $75 million.

The narrowed forecast comes in largely below analysts’ estimates of $5.015 billion.

Several other Apple suppliers such as contract chipmaker Taiwan Semiconductor Manufacturing Co Ltd, Corning Inc and AMS have also pointed to soft demand from smartphone customers.

Analysts have attributed the softness to weaker-than-anticipated demand for Apple’s iPhone X.

“Looking ahead to our third fiscal quarter, we expect continued strength in demand from datacenters while wireless remains weak,” Chief Executive Officer Hock Tan said in a statement.

Third quarter net revenue is expected to be in the range of $5.05 billion, plus or minus $75 million. Analysts on average expect net revenue of $5.23 billion, according to Thomson Reuters I/B/E/S.

Shares of the company were down 0.7 percent at $231.23 in premarket trading.

Reporting by Arjun Panchadar in Bengaluru; Editing by Saumyadeb Chakrabarty

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